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Some $36 billion in payments to be made to farmers for contract crops for fiscal years 1996-2002 under Title I of the FAIR Act of 1996, known as the Agricultural Market Transition Act (AMTA). The total amount made available for each fiscal year is specified in the Act and allocated to commodities each fiscal year using a set of percentages also specified in the Act. These percentages were based on the Congressional Budget Office’s February 1995 baseline forecast of what deficiency payments would have been if provisions in effect for the 1995 crop had been extended. For example, for fiscal 1997, the total allocation for wheat is 26.26% of total annual payments of $5.385 billion, or $1.414 billion. The annual payment rate for wheat equals total spending ($1.414 billion) divided by the sum of all individual wheat payment contract quantities for the year. As with other program commodities, an individual farm’s payment quantity equals the farm’s program payment yield multiplied by 85% of the farms wheat contract acreage. Program yields under the 1996 Act are determined in the same manner as under the 1949 Act for 1995 crops. An individual farmer’s transition payment is the payment quantity times the annual payment rate. The payment is made by September 30 of each of the fiscal years 1996 through 2002. Producers may also choose to receive 50% of the contract payment in December or January of the fiscal year. Farmers have near total planting flexibility on the contract acres (the exception being fruits and vegetables) as well as on the remainder of the farm.

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